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Home My WebLink AboutAMENDMENT NO 4 OMI , .. .' AMENDMENT NO.4 TO THE AGREEMENT FOR OPERATIONS, MAINTENANCE AND MANAGEMENT SERVICES FOR AUGUSTA, GEORGIA This AMENDMENT No.4 to the Agreement dated July 20, 1999 is made and entered into this ~ I ~ day of 7fI,kj , 2002, betv,'~en Augusta, Georgia, a political subdivision of the State of Georgia, whose address for any formal notice is 530 Greene Street, Room 801, Augusta, Georgia 30911, Attention: City Admii,listrator (hereinafter "Owner"), and Operations Management International, Inc. (hereinafter "OMI"), with offices at 6060 South Willow Drive, Suite 200, Greenwood Village, Colorado 80111-3333, whose address for any formal notice is Post Office Box 6607, Englewood, Colorado 80155-6607. NOW, THEREFORE, Owner and OMI agree to amend the Agreement as follows: 1. Article 2.34 is hereby deleted in its entirety and replaced with the following Article 2.34: 2.34 Provide, for and document repairs as described in Appendix A.5, provided the total amount OMI shall be required to pay does not exceed Three Hundred Forty-nine Thousand One Hundred Eighty-five Dollars ($349,185.00) during the third year of this Agreement (January 1, 2002 through December 31, 2002). At such time that actual repair's costs exceed the annual repairs limit, OMI shall invoice and the Owner shall pay excess repairs' coso on a monthly basis. Said repairs will be invoiced at direct costs, with no mar~(Up for overhead or profit. OMI will rebate to Owner the entire amount that actual repairs are less than the repairs' limit during the period of this Agreement. Repairs' amounts below or in excess of the annual repairs' Limits shall not contribute to Base Fee overages or underages. 2. Add Article 2.10: 2.10.1 Biosolids Application. Provide and document all biosolids application for the project. Provide Owner with an accounting of actual biosolids application and liming on not less than a quarterly basis. OMI will provide Owner with a detailed invoice ofbiosolids application over the annual budget, and negotiate each year with Owner an annual biosolids application budget. Should Owner and OMI fail to agree, the biosolids application budget will be determined by the application of the Consumer Price Index (CPI) adjusted for actual consumption in the prior year and any flow increases over the prior year. 2.10.2 Should the actual biosolids applicati In expenditures be less than the annual biosolids application budget, the management fee provided in Article 4.1 shall be increased by twelve and one-half percent (12.5%) of the difference, provided OMI does not exceed the annual cost of serviced set forth in Article 4.3 -1- 3. Article 4.1 is hereby deleted in its entirety and replace with the following Article 4.1 : 4.1 For services rendered during the thid period of this Agreement (January 1, 2002 through December 31, 2002), Owner shall pay to OMI a base fee equal to the actual cost of services as provided in Article 4.3 performed, which includes a Management Fee of One Hundred Fifty-one Thousand Two Hundred Sixty Dollars ($151,260). Said Management Fee and Base Fee shall be paid in twelve equal monthly installments. Management Fee shall increase proportionally with Base Fee adjustments described in Article 4.4. 4. Article 4.3 is hereby deleted in its entirety and replaced with the following Article 4.3: 4.3 OMI estimates that cost for services for the third period under this Agreement (January 1, 2002 through December 2002) shall be Five Million, Seven Hundred Twenty-two Thousand, Six Hundred Eighty Dollars ($5,722,680.00). Details of said cost are shown in Appendix K. The Base Fee shall be negotiated each year beginning 90 days prior to conclusion of contract year. Should Owners and OMI fail to agree, the Base Fee will be determined by the application of the Base Fee Adjustment Formula shown in Appenulx F. 5. Article 4.9 is hereby deleted in its entirety and replaced with the following Article 4.9: 4.9 OMIts compensation for Owner-Directed Capital Improvements shall be as follows: (1) Programs undertaken by OMI personnel shall be subject to mutually agreeable terms and conditions of compensation and payment; (2) programs which OMI assigns to subcontractor personnel shall be billed at cost, plus a fee of five percent (5%) of direct costs, in lieu of the ten and one half percent (10.5%) administrative fee set forth in Article 4.7. On-site labor already covered under this contract shall not be billed against the Owner-Directed Capital Improvements account. There will be a total compensation limit of Five Hundred Thousand Dollars ($500,000.00) for Owner-Directed Capital. The Costs for Owner-Directed capital Improvements are not included in the estimated costs identified in Article 4.3. 6. Article 4.1 0 is hereby deleted in its entirety and replaced with the following Article 4.10: 4.10 Owner shall pay to OMI $170,250 for an allowance for assistance requested by the Utility Director. Said amount is included in the amount stated in Article 4.3. Such assistance will be requested in writing. Any amount not spent will be fully refunded to Owner within sixty days of Agreement year-end. Owner will pay any amounts requested and expended by OMI in excess of the above amount at direct cost plus overhead and management fee. 7. Article 5.1 is hereby deleted in its entirety and replaced with the following Article 5.1: -2- " 5.1 One Twelfth (1/12) of the base fee for the third period and all subsequent periods shall be due and payable on the first of the month for each month that services are provided. 8. Appendix K is hereby deleted in its entirety and replaced with the attached Appendix K. 9. Appendix M is added to define project staffing. Actual staffing will be adjusted to be within the budget allowance for staffing and benefits shown in Appendix K. All other terms and conditions remain in effect in accordance with the original Agreement. . Both parties indicate their approval ofthis Agreement by their signatures below. ---~ A7;(hOriZed Signature: " \ (.' ) J .? 'VV 1/ . /. fLvvy/ Bob Young Title: Mayor OPERATIONS MANAGEMENT INTERNATIONAL, INC. . - \, _ .A'? Date: i 0 c~t' ft.; 1,:... I AUGUSTA, GEORGIA ATTEST: ~J -~i- Appendix K ESTIMATED COSTS Annualized Description Cost Labor and Benefits $ 1,755,031.21 Administrative $ 95,985.24 Equipment and Vehicle Exp $ 71,022.00 Biosolids App $ 1,001,268.00 Training $ 51,517.20 Materials and Supplies $ 102,300.12 Chemicals $ 337,500.00 Outside Services $ 122,180.04 Power $ 1,003,200.00 Repair $ 349,185.00 Miscellaneous $ 2,820.00 Sub-total $ 4,892,008.81 Overhead 10.5% $ 513,660.92 Management Fee $ 146,760.26 Sub-total $ 660,421.19 Directors Allowance $ 150,000.00 Overhead 10.5% $ 15,750.00 Management Fee $ 4,500.00 Sub-total $ 170,250.00 Total $ 5,722,680.00 Appendix M . OMI Augusta Pr'jject Staffing Regional Business Manager (0.5 FTE) Project Manager Administrative Assistant Assistant Project Manager Operations Manager Lead Operator Operator - 9 Laboratory! IPP Director IPP Manager IPPTechnician - 3 Chemist Laboratory Technician - 2 Maintenance Manager Purchasing Coordinator Lead Mechanic Mechanic - 5 Utility Worker - 3 Land Application Manager , ;, , '. .> 4 $ 3,300,000 $ 492,000 $ 895,000 $1,387,000 $ 337,000 V. Non.EconomicComparison All non-economic indicators favor dewatered sludge application. The indicators include the following: . Program costs much less sensitive to hauling distance. Becomes feasible to haul distances that are not conceivable with a liquid-based program. Opens up much greater area for consideration of new land application sites. . Increased flexibility to meet short term challenges, from onsite, short-term storage to landfilling. These options are not available with a liquid-based program. . Fewer large trucks on the road results in reduced liability from accidents, farmer issues, and from a general complaints and public relations perspective. , . Program becomes less sensitive to fuel and labor costs. VI. Recommendations OMI recommends that Augusta give serious consideration to converting the existing liquid-based land application program to one that incorporates dewatered sludge. The savings available through a dewatered program should be sufficient to actually allow Augusta to purchase a dedicated site. A less costly alternative would be to use some of the savings 0 as compensation, to establish a long-term contract with a local landowner to furnish a dedicated site. OMI welcomes the opportunity to work with Augusta to resolve long-term sludge management issues. OMI commits to implement with equal vigor whatever program Augusta deems is best suited for its future needs. 5